Alternative trading system (ATS) provider tZERO has announced a deal with real estate crowdfunding company NYCE Group, also known as the “Robinhood of real estate investing”. The purpose of the deal is to tokenize $18M worth of NYCE Group’s shares according to a June 30 announcement.
“We are pleased to partner with NYCE, a pioneer in real estate crowdfunding, and support the secondary trading of its digital security,” said tZERO CEO Saum Noursalehi.
tZERO was founded in 2014 and based in New York City, is self-described as “a technology firm that was founded with the goal of utilizing distributed ledger technology to revolutionize financial technologies so that they are more efficient, accessible and transparent.”
NYCE will be tZERO’s first new offering in almost a year. The last addition to the firm’s listings was last August when it announced its ASPN listing in which digitized versions of shares of a Colorado ski resort were put up for trade.
Secondary trading of NYCE’s tokenized common shares will begin once approval is given in the real estate firm’s pending Regulation A+ offering. This is on the heels of a record-setting Regulation Crowdfunding (Reg CF) offering on WeFunder and Republic. The October 2020 Reg CF offering brought in $1M and set a record for the fastest to raise seven figures. The company went on to officially launch its investment app in March of this year.
NYCE CEO and Co-founder Philip Michael comments on the tZERO partnership:
“Through our partnership with the leader in liquidity for digital securities, tZERO, we are excited to provide investors with liquidity optionality.”
Michael Co-founded the company with Barcelona Football Club forward Martin Braithwaite. The two created the company with the goal of creating 100,000 high-net-worth millennial stakeholders of colour by 2030. They hope to achieve this by allowing retail investors to acquire fractionalized shares in properties in its portfolio; a portfolio amounting to about $260M.
The market for security tokens saw a huge rise in the past years. In 2020 for example, monthly volume was $194,000 in January and went on to increase by over 100 times to about $22M in August.
The ASPN token, for example, since its launch has continued to trail behind tZERO’s native token TZROP and Overstock’s digital security OSTKO. This, however, does not translate into high trade activity. Monthly trade for ASPN has taken a nose-dive of more than 75% coming to less than $5M in May.
A report by Security Token Group reveals that tZERO’s native token had $2.7M worth of trade in the same month as the most traded token. With a market cap of about $140M, it ranks as the 229th-largest crypto asset by CoinGecko standards.